Question $241$ pts

Peloton article:

Why do you think Peloton simultaneously raised subscription rates while lowering the price of the hardware $($the bike$)?$

Group of answer choices

Their instructors threatened to go on strike.

They know they have existing customers locked in $($due to transaction specific investments$),$ so they are holding them up while trying to attract new customers.

Their raw material costs went down.

Flag question: Question $25$

Question $251$ pts

Vertical integration article:

What is one benefit of vertical integration that the article highlights, in light of supply chain issues from Covid$/$other world events?

Group of answer choices

The ability to focus on core competencies rather than integrating parts of the supply chain.

Guarantee a reliable supply of raw materials from sources that you have brought inside your company.

Negotiating many contracts for a better deal.

Flag question: Question $26$

Question $261$ pts

Tesla article:

Bringing all aspects of Tesla production under one roof will allow Musk to take advantage of economies of scope and scale.

Group of answer choices

True

False

Flag question: Question $27$

Question $271$ pts

Tesla article:

The article cites a shortage of computer chips and greater competition for raw materials for batteries as potential constraining factors on Tesla$$s growth this year. If Tesla were to buy computer chip manufacturers and the producers of the raw materials used in the batteries, this would be an example of:

Group of answer choices

backwards vertical integration

forwards vertical integration

None of the options

Flag question: Question $28$

Question $281$ pts

Your company is contemplating the adoption of general artificial intelligence $($genAI$)$ to streamline operations and enhance decision$-$making processes. Implementing such technologies involves changes in infrastructure, training, and potentially, business models. Considering these factors, what might be the impact of integrating genAI on your company's transaction costs?

Group of answer choices

Increase in short$-$term transaction costs due to expenses related to technology integration, training for employees, and complex contract negotiations, but potential for long$-$term cost savings as processes become automated and decision$-$making is enhanced.

Significant and sustained increase in transaction costs due to ongoing needs for updating technology, maintaining high levels of cybersecurity, and managing specialized staff and technology partnerships.

No significant change in transaction costs, as savings from automation are offset by new expenses related to technology management and compliance with regulations.